Tether-backed Northern Data explores sale of crypto mining arm to boost AI growth

Northern Data AG is exploring the sale of its Peak Mining unit to refocus on artificial intelligence solutions.

Northern Data, a German-listed crypto and artificial intelligence infrastructure company backed by stablecoin issuer Tether, announced on Monday that it is exploring the sale of its Peak Mining unit, a move aimed at solidifying the company’s position as a pure-play provider of AI solutions.

In an Oct. 21 press release, the Frankfurt-headquartered company indicated that the potential sale of Peak Mining aligns with Northern Data’s strategy to focus on Europe’s largest Generative AI cloud platform and a portfolio of data centers.

Northern Data chief executive and founder Aroosh Thillainathan emphasized the importance of identifying a suitable steward for the crypto mining business while reaffirming the company’s commitment to blockchain technology.

“Mining is a foundational part of Northern Data’s heritage and growth story. We remain supporters of blockchain technology and continue to believe in its potential.”

Aroosh Thillainathan

The proceeds from the potential sale are expected to be reinvested into expanding the AI product platform, particularly its Dynamic Enablement Services, which will include new software capabilities and managed services, the press release reads. Additional investments will target data center acquisitions and the procurement of AI GPUs to further enhance infrastructure.

Following the announcement, shares of Northern Data surged to €35.20, a 10.69% increase on the Frankfurt Stock Exchange. The potential divestment comes a few months after the company reported a 22% revenue increase in Q2, despite challenges from the Bitcoin halving. Norther Data generated €26 million in revenue during the quarter, fueled by strong performance from its cloud platform and strategic investments in its data center footprint and mining facilities.

In September 2023, Tether announced a collaboration with Northern Data to focus on initiatives around AI, peer-to-peer communications, and data storage solutions. The stablecoin issuer didn’t disclose any figures related to the deal but refuted reports suggesting it had spent $420 million on 10,000 H100 GPUs from Northern Data.